The Asian market offers great opportunities for European agro-food products, especially high quality products, according to a study presented recently, which analyses the impact on the agricultural sector of trade agreements between the EU and three other markets: Mexico, Switzerland and South Korea.
The report, carried out by a consultant at the request of the European Commission, concludes that those three agreements alone have increased European agro-food exports by more than 1 billion Euro and improved the sector's added value by some 600 million.
In particular, it highlights the potential that Asian markets offer to European agro-food exports, due to their "demand for high-quality products and limited domestic production capacity," explained European Commissioner for Agriculture Phil Hogan.
To be precise, Asia has the potential to generate new business opportunities for innovative European companies able to adjust their production to "local preferences."
However, the study also warns that "there is growing protectionism and scepticism about the benefits of free trade, which would make it difficult for that potential to materialise."
Therefore, it points to the need of carrying out a "better communication" on the advantages and disadvantages of trade liberalization.
Of the agreements analysed, the report concludes that the one with Mexico, which came into force in 2000, has allowed for an increase in European agro-food exports to Mexico between 1995 and 2004, although this has happened "at a slower pace than the overall increase in Mexican agro-food product imports."
In particular, European exports to Mexico have increased by some 105 million Euro, while Mexican imports to the EU have increased by about 315 million.
Moreover, "the EU has lost market share throughout most of the period," while "Mexico has increased its market share over most of the same period."
Meanwhile, the agreement with South Korea, which came into force in 2011, "seems to have put an end to the negative trend of Europe's market share in that country," according to the report.
European exports to South Korea have actually increased by about 440 million Euro.
Furthermore, the increase in the volume of European exports has given a boost to the European agro-food production and the agreement has led to the creation of 15,000 jobs in the European sector.
Meanwhile, the two EU-Switzerland trade agreements, which mainly cover processed products and beverages, have resulted in an increase of EU exports to the Swiss country, which total 530 million Euro.
The study points out that the Union's agro-food sector could benefit more from trade agreements with third countries and assures that there is potential to increase such trade, even within the framework of existing agreements.
It is worth recalling that agreements are, in many cases, necessary to access new markets or introduce new products.
Source: EFE
